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Joint Survivorship: When One is More Than Two

An article, written by Veronica Daugher, does a fine job of identifying the potential benefits of joint survivorship and a two-insured life policy.

These include:

  • Liquidity for both federal and state estate tax;
  • Protection for illiquid assets, such as a private business, a real-estate portfolio or an art collection;
  • Tax-free funds for heirs to replace the value of assets a decedent left to charity;
  • Estate equalization for people with many children, regardless of net worth. Parents may leave the family home to a child living nearby, then try to equalize their children’s inheritance by making their other children the beneficiaries of the policy;
  • Special-needs-trust planning.

Daugher writes that the premium for two people in a joint survivorship policy is frequently lower then the premium would be for an individual policy on each spouse. I would add that this is especially important if one of the potential insureds has a serious illness, or other higher risk factor.

Do you have assets to protect within your estate? What kind of challenges have you encountered in your efforts to purchase life insurance for this protection?